The biggest mistake Israel made in the wake of the 1967 War was to NOT expel all non-Israelis from their homeland, re-take ALL the land God Promised Abraham in Genesis, and implode the Mosque desecrating the land on the Holy Temple. The leaders of Israel at that time were secularists, and didn't realize the Biblical implications of NOT driving the Caananite heathens from the land.
Nahum Goldmann, president of the World Jewish Congress, wrote that in a conversation about "the Arab problem" in 1956, Ben-Gurion stated: "Why should the Arabs make peace? If I was an Arab leader I would never make terms with Israel. That is natural: we have taken their country ... There has been anti-Semitism, the Nazis, Hitler, Auschwitz, but was that their fault? They only see one thing: we have come here and stolen their country. Why should they accept that? They may perhaps forget in one or two generations' time, but for the moment there is no chance. So it is simple: we have to stay strong and maintain a powerful army."